Living without a credit card

 Hello,

I have problem with credit cards.  I flash them for gas, sometimes for
lunch, groceries etc.  They are the small ticket items but are
accumulating on my balance.  Now that I have accepted that I have a
problem, I want to really wean out of this reliance on credit card.
Please share with me if anyone in this forum had this problem and have
successfully detached from the credit card.  The balance is really
stressing me out.


Thank you in advance for any help.

NJ
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Random URL found on the Internet
http://memoriter.net/flash/test.html

 

Cut up your credit cards or take them out of your wallet and stash them
at home where they are not within easy reach.

 

The credit card is not the problem, rather it is the fact that you are
spending more than you make that is the problem.

1) Plan your spending before you spend your money. At the beginning of
the month, decide how much you are going to spend and what you are going
to spend it on. Don't spend more than you are going to make that month.
If you have a variable income, then don't spend more than you made last
month. Try to aim for spending about 10% less.

2) Track your credit card balance as carefully as you track your
checkbook balance. It's a good idea to even keep an extra check register
on hand for credit card purchases and write them in the register when
you make a purchase.

3) Make sure that your monthly statement balance is less this month than
it was last month, do that every month and you *will* pay off the pesky
card.

 On Sun, 02 Dec 2007 08:23:23 -0500, "Daniel T."


4) Build up your savings to at least 4 months take home pay.  Use an
online banking account to get interest over 4%.  You could also have
it direct deposited from your pay check.  This money could be used for
emergencies (new heating system, major car repairs) so you wouldn't
have to use your credit card.  Once you reach your savings goal,
continue to save but put anything over your 4 months reserve in
investment vehicles that could yiled higher than 4%.  Keep your
reserve liquid so you have a ready source of emergency funds.

 

I believe that to be an error in logic.  Having a huge amount of
cash sitting earning almost nothing is silly when the OP has a
credit card debt that is accumulating interest fees at the rate
of 21% to 29%.  The best strategy is to do whatever is possible
to pay down this bill.  If you have an extra 2 cents, send it
in and don't pay rip-off interest on it.

If a person is wealthy or has a very high income, they can afford
to make a mistake like letting cash sit around doing nothing.  But
most work-a-day people don't have that luxury.  They have to have
every dollar work twice as hard because they don't have all that
many dollars to start with, and they are going to need a million
or more in retirement funds to avoid starvation when they are 92
years old.

To summarize:

- don't set up an "emergency fund" or "rainy day fund" unless
you are wealthy or have a high income.

- do pay every last penny towards credit card debt (and to other
high rate debt that is above 7%).

- don't incur new debt except for a primary home, and then, make
sure that it is a reasonable debt that you can live with.

- once bills are paid off, save like mad for retirement.

- keep a credit card for emergencies.

- try to minimize emergencies.

- pay off the emergency bills as soon as possible.

Avoid the rainy day fund trap if you want to get out of debt.

-john-

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John A. Weeks III           952-432-2708            john@johnweeks.com
Newave Communications                         http://www.johnweeks.com
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